1 Procurement Committee Terms of Reference
Procurement Committees serve a critical function by ensuring a organisation extracts value from its procurement transactions. Additionally, it also ensure compliance to the procurement policy through an impartial analysis of the transaction.
Similar to the Procurement Policy, the organisational context is important. The sample TOR/Charters provided below are from a quasi-government organisation, and as such may appear bureaucratic. The key takeaway is understanding committee types and their roles.
1.1 Introduction
The Procurement Policy governs multiple activities of the procurement process.
Accordingly, the policy requires the establishment of five committees ensuring adequate governance on procurement matter; these committees are as follows:
- Technical Tender Opening Committee
- Technical Evaluation Committee
- Commercial Tender Opening Committee
- Tender Committee
- Vendor Blacklisting Committee
The scope of all five committees is limited to the governance of corporate procurement activities, its processes, and adherence to approved procurement policies.
The following general provisions are applicable to all the charters within this document:
The Head of Procurement shall periodically review this Charter and assure its adequacy to its purpose and propose amendments if needed.
This Committee Charter is deemed effective as of the date of obtaining relevant approvals.
1.2 Technical Bids Opening Committee
The Committee’s purpose is to open technical envelopes while noting relevant details.
1.2.1 Committee Scope
The scope is as follows:
- Opening of technical bids submitted by the vendor
- Ensure the Requesting Department completes the technical evaluation within the predefined time
- Vendors have agreed to the Company’s terms conditions
- Ensure the vendor has submitted pertinent evidence for their commercial licenses
The Committee is not responsible or empowered to conduct a commercial analysis.
1.2.2 Committee Members, Quorum & Secretary
The following positions and their involvement constitute as committee members
| Committee Position | Organisational Position |
|---|---|
| Chairperson | Procurement Manager |
| Member/Secretary | Procurement Operations |
| Member | Requesting Department |
- The quorum constitutes of all individuals in the table above. If a member is unable to attend they must appoint a delegate in writing.
1.2.3 Committee Proceedings
All decisions of the Committee shall be in writing and signed by the members.
Committee meetings invites shall be circulated 1 day before any proposed meeting time, with the possibility of opening technical bids on the same date as the bid submission date.
The Committee Secretary is responsible to maintain minutes in a clear, concise, comprehensive manner.The minutes must clearly set out the: vendor name with submitted technical proposal, contents submitted by each vendor, vendors rejected for incorrect submissions, key decisions, and next steps.
The Committee Secretary shall circulate the draft minutes of meetings to the Members and attendees within two (2) days of the conclusion of the meeting.
1.3 Technical Evaluation Committee
The Technical Evaluation Committee (TEC) is second of the five committees within Procurement to ensure strong governance. Its primary objective is to ensure Requesting Departments complete the technical evaluations, and thus has a fluid composition. At times, technical evaluations may require multiple parties to assess a tender and times developing a confirmed membership is difficult.
1.3.1 Committee Scope
The scope of the the Committee is as follows:
- Developing a technical evaluation score for submitted bids (in an event it wasn’t submitted as part of the RFP document)
- Technical evaluation of submitted bids
- Involving relevant parties as assessors and signatories to conduct a technical evaluation
1.3.2 Committee Responsibilities
The Requesting Department Representative will conduct the technical evaluation of the tender.
The Requesting Department is responsible to convene, analyze, and report on the finalized technical evaluations in conjunction with the invited parties.
The Requesting Department can engage additional parties as they seem fit to complete the technical evaluation.
1.3.3 Committee Decisions
All decisions of the Committee shall be in writing with the Requesting Department completing the technical evaluation.
The technical evaluation will state the criteria used, the scoring of each vendor, and the vendor with the higher technical evaluation score.
The technical evaluation will also state the vendors rejected stating the reasons of such rejections.
1.4 Commercial Tender Opening Committee
This is the third of the five committees within Procurement to ensure strong governance.
Its primary objective is to assess the commercial evaluation of vendors after they have passed the technical evaluations.
1.4.1 Committee Scope
The scope of the Committee is limited to the following:
- Opening of the commercial bids and logging the submitted prices
- Conducting a techno-commercial evaluation
- Recommending a vendor for award based on the techno-commercial evaluation
1.4.2 Committee Members, Quorum & Secretary
The following positions make up the Committe:
| Committee Position | Performed By |
|---|---|
| Chairperson | Procurement Manager |
| Member | Finance Representative |
| Secretary | Procurement Officer |
- The quorum constitutes of all individuals in the table above. If a member is unable to attend they must appoint a delegate in writing.
1.4.3 Committee Proceedings
All decisions of the Committee shall be in writing and signed by the members.
Committee meetings invites shall be circulated 1 day before any proposed meeting time, with the possibility of opening technical bids on the same date as the bid submission date.
The Committee Secretary is responsible to maintain minutes in a clear, concise, comprehensive manner.The minutes must clearly set out the: vendor name with submitted technical proposal, contents submitted by each vendor, vendors rejected for incorrect submissions, key decisions, and next steps.
The Committee Secretary shall circulate the draft minutes of meetings to the Members and attendees within two (2) days of the conclusion of the meeting.
1.5 Tender Committee
It is fourth of the five committees within Procurement to ensure strong governance. Its primary objective is to ensure adequate methods were used to arrive at the awarded vendor and endorse awards prior to the delegated authority signing it off.
1.5.1 Committee Scope
The scope of the Cpmittee as follows:
- Comprehensive examination of methods used to award a vendor
- Validating the recommendation from the respective committee either through a formal approval, rejection, or rebidding
- Instructing to proceed with negotiations with vendors using techniques such as best-and-final-offer (BAFO) and/or last-and-final-offer
1.5.2 Committee Members, Quorum & Secretary
The composition of the the Committe is contingent on the value of the expected contract value. Accordingly, the composition of the committee members is as follows:
| Value (relevant currency) | 200 K – <1 million | 1 million – < 5 million | 5 million |
|---|---|---|---|
| Committee Position | Performed By | Performed By | Performed By |
| Chairperson1 | Treasurer | Chief Legal Officer | Chief Operating Officer2 |
| Member | Head of Corporate Procurement | Chief Finance Officer | Chief Finance Officer |
| Member | Spending Efficiency Representative | Head of Corporate Procurement | Chief Legal Officer |
| Secretary3 | Procurement Manager | Procurement Manager | Head of Procurement |
- The quorum constitutes of all individuals in the table above. If a member is unable to attend they must appoint a delegate in writing.
1.5.3 Committee Proceedings
All decisions of the Committee shall be in writing and signed by the members.
Committee meetings invites shall be circulated 1 day before any proposed meeting time, with the possibility of opening technical bids on the same date as the bid submission date.
The Committee Secretary is responsible to maintain minutes in a clear, concise, comprehensive manner.The minutes must clearly set out the: vendor name with submitted technical proposal, contents submitted by each vendor, vendors rejected for incorrect submissions, key decisions, and next steps.
The Committee Secretary shall circulate the draft minutes of meetings to the Members and attendees within two (2) days of the conclusion of the meeting.
1.6 Vendor Blacklisting Committee (VBC)
The VBC is last of the five committees within Procurement to ensure strong governance. Its primary objective is to ensure vendors are prevented from future business based on multiple factors such as (but not limited to): extremely poor vendor performance, material breaches of contract, non-compliance with policies and procedures
1.6.1 VBC Scope
The scope of the VBC as follows:
- Comprehensive examination and analysis of the nature of vendor breach
- Assessment (qualitative or quantitative) impact on the Company
- Developing a legal course of action, if needed
1.6.2 Committee Members, Quorum & Secretary
The following positions and their involvement constitute the VBC:
| Committee Position | Performed By |
|---|---|
| Chairperson | Head of Procurement |
| Vice Chairperson | Chief Legal Officer |
| Member | Chief Finance Officer |
| Member | Chief Operating Officer |
| Secretary | Procurement Manager |
Meeting Quorum & Attendance—The quorum of the VBC will constitute of all individuals in the table above. In an event a member is unable to attend the VBC, they must provide their delegate in writing.
1.6.3 Committee Proceedings
All decisions of the Committee shall be in writing and signed by the members. If the Committee is unable to reach a decision, the matter shall be presented to the CEO for resolution.
Committee meetings invites shall be circulated 1 day before any proposed meeting time, with the possibility of opening technical bids on the same date as the bid submission date.
The Committee Secretary is responsible to maintain minutes in a clear, concise, comprehensive manner.The minutes must clearly set out the: vendor name with submitted technical proposal, contents submitted by each vendor, vendors rejected for incorrect submissions, key decisions, and next steps.
The Committee Secretary shall circulate the draft minutes of meetings to the Members and attendees within two (2) days of the conclusion of the meeting.